Economics • Economic BasicsEasy
What is the primary characteristic of an Oligopoly market structure?
A. A single seller with complete control over the market price
B. A large number of independent firms selling identical products
C. A few large firms dominating the market with mutual interdependence✓ Correct Answer
D. Many firms selling differentiated products with easy entry and exit
💡 Solution & Explanation
An oligopoly market structure is defined by the dominance of a small number of large firms whose pricing and output decisions exhibit strong mutual interdependence. Unlike a monopoly with a single seller or perfect competition with numerous small firms selling identical products, oligopolistic firms must strategically anticipate competitor reactions. Real-world examples include automobile manufacturing and telecommunications sectors.
More Economics Economic Basics questions
- How does the monetization of forest produce and non-timber forest products (NTFPs) structurally impact the…
- In the context of environmental economics applied to Arunachal Pradesh, what economic dilemma arises from…
- In game theory, what is a 'subgame perfect equilibrium' (SPE) designed to eliminate?
- What is meant by 'Veblen Good' in consumer choice theory?
- What is the primary implication of 'Crowding Out' effect in fiscal economics when the government increases…